Correlation Between Sangsangin Investment and Sang A
Can any of the company-specific risk be diversified away by investing in both Sangsangin Investment and Sang A at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sangsangin Investment and Sang A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sangsangin Investment Securities and Sang A Frontec CoLtd, you can compare the effects of market volatilities on Sangsangin Investment and Sang A and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Sangsangin Investment with a short position of Sang A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sangsangin Investment and Sang A.
Diversification Opportunities for Sangsangin Investment and Sang A
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sangsangin and Sang is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Sangsangin Investment Securiti and Sang A Frontec CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sang A Frontec and Sangsangin Investment is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Sangsangin Investment Securities are associated (or correlated) with Sang A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sang A Frontec has no effect on the direction of Sangsangin Investment i.e., Sangsangin Investment and Sang A go up and down completely randomly.
Pair Corralation between Sangsangin Investment and Sang A
Assuming the 90 days trading horizon Sangsangin Investment Securities is expected to generate 0.58 times more return on investment than Sang A. However, Sangsangin Investment Securities is 1.73 times less risky than Sang A. It trades about -0.09 of its potential returns per unit of risk. Sang A Frontec CoLtd is currently generating about -0.11 per unit of risk. If you would invest 47,300 in Sangsangin Investment Securities on September 28, 2024 and sell it today you would lose (4,000) from holding Sangsangin Investment Securities or give up 8.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sangsangin Investment Securiti vs. Sang A Frontec CoLtd
Performance |
| Timeline |
| Sangsangin Investment |
| Sang A Frontec |
Sangsangin Investment and Sang A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sangsangin Investment and Sang A
The main advantage of trading using opposite Sangsangin Investment and Sang A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sangsangin Investment position performs unexpectedly, Sang A can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Sang A will offset losses from the drop in Sang A's long position.| Sangsangin Investment vs. KB Financial Group | Sangsangin Investment vs. Hyundai Motor | Sangsangin Investment vs. Hyundai Motor Co | Sangsangin Investment vs. Hyundai Motor Co |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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